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Would it have helped if she prefaced it with, "Here's a hypothetical about a company wanting to do illegal things..."? The style of argument is akin to Reducti

by bb88 3y ago

Would it have helped if she prefaced it with, "Here's a hypothetical about a company wanting to do illegal things..."? The style of argument is akin to Reductio ad Absurdum, taking an absurd position to it's logical conclusion. The "absurd position" here is a company wanting to sell heroin on the open market, and she takes that to the logical conclusion. She could have said "meth", "nuclear weapons", or "dead infants", or whatever instead of heroin to make her point. If you read that as a comparison to Coinbase being a heroin dealer than you're the one editorializing her effort. Here's another reductio ad absurdum argument: Let's assume the earth is flat. Either the surface of the earth must go to infinity or people must be walking off the edge of it somewhere.

friend_and_foe 3y ago
Youre completely.ignoring the fact that "heroin is illegal" is cut and dry. Securities are not illegal. Selling them without a license is. Asking them to clarify the law and getting told "the law is clear" is not in any way the same as selling heroin knowing it is illegal.
- rjbwork 3y ago
  The law is clear. It's not the job of regulatory agencies to advise companies on how to become compliant with the law and their rules. The law and their rules are...the law and their rules! Hire a lawyer for that!
  - AnthonyMouse 3y ago
    > It's not the job of regulatory agencies to advise companies on how to become compliant with the law and their rules. Honestly this should be a core mission of all regulatory agencies and the fact that it isn't is a disgrace.
    - JumpCrisscross 3y ago
      > this should be a core mission of all regulatory agencies and the fact that it isn't is a disgrace You want public sector corporate law? If we’re socialising law, I’d think we’d start with criminal defense.
      - bb88 3y ago
        I personally don't want tax dollars to fund corporate lawyering.
      - friend_and_foe 3y ago
        Theres a distinction somewhere between "socializing law" and "tell me why you'd sue me before I do it accidentally."
        hef19898 3y ago
        The latter isn't a thing so. Especially if, as Coinbase and Binance did, ignore willingly the most basic rules around ypur business because of tech, innovation, disruption and the internet. About time that reality checks happen.
    - rjbwork 3y ago
      It would be absurdly burdensome and expensive for the government to have to advise people on how to follow the law when they're not following the law. If you're not sure how to follow the law, get an expert in the law! That's why there's a regulated profession that explicitly provides expert advice on following the law. I don't want to press too far, because I don't think you actually meant it, but...it's like you're advocating for socialized lawyers. Which is definitely an interesting idea!
      - AnthonyMouse 3y ago
        > It would be absurdly burdensome and expensive for the government to have to advise people on how to follow the law when they're not following the law. Isn't this the exact same burden it would be for that person to hire a lawyer? All it would do is require the government to internalize the cost of regulatory compliance, which would increase efficiency by aligning the incentives of the government with reducing compliance costs. > If you're not sure how to follow the law, get an expert in the law! That's why there's a regulated profession that explicitly provides expert advice on following the law. Except that they don't actually have the authority to tell you if you're following the law. If you hire a lawyer and they tell you that the law is ambiguous and there isn't any relevant caselaw yet, you still have no idea if you're following the law or not. Meanwhile no one with the authority to make a binding determination will give you an answer.
        rjbwork 3y ago
        >If you hire a lawyer and they tell you that the law is ambiguous and there isn't any relevant caselaw yet, you still have no idea if you're following the law or not. Then you have a couple of choices with various outcomes. One of which is exactly what is happening to Coinbase right now. You can either 100% unambiguously follow the law, or you can push your luck and adhere to what you think either is or should be the law. In the latter case you may become said case law, whether you are able to continue your current ambiguously legal business practices or not!
        AnthonyMouse 3y ago
    - hef19898 3y ago
      It is not the government's job to provide free compliance consulting services. Especially not for VC backed companies awash in cash.
  - deleted 3y ago
    [deleted]
- bb88 3y ago
  I quote from TFA: Coinbase also writes in great detail in the S-1 about the risk that the SEC might bring a lawsuit exactly like the one they just have: [W]e could be subject to legal or regulatory action in the event the SEC, a foreign regulatory authority, or a court were to determine that a supported crypto asset currently offered, sold, or traded on our platform is a “security” under applicable laws… [W]e could be subject to judicial or administrative sanctions for failing to offer or sell the crypto asset in compliance with the registration requirements, or for acting as a broker, dealer, or national securities exchange without appropriate registration. [T]here is regulatory uncertainty regarding the status of our staking activities under the U.S. federal securities laws. It's pretty clear they knew they were operating in a shady area from their S1 filing -- and so now you're surprised the regulatory hammer fell on them? Imagine if a company was selling "ground human meat" (see the movie "Soylent Green"). And they did it, well, because the market for ground human meat was suddenly exploding! I mean, in their S1 they might say "Sure this might be illegal, the FDA might take regulatory action against us." But also "Ground human meat is one hot market right now, you don't want to be left out on this rocket that's going straight to the moon!"
  - rockemsockem 3y ago
    Sounds like they expected in advance for the SEC to do something stupid and were very upfront about that fact. Now that the SEC has done a stupid thing they are complaining that the SEC in fact did the stupid thing. Sounds perfectly reasonable to me.
    - scott_w 3y ago
      Enforcement agencies don't have to stop you ahead of time, even if that action is disallowed or even illegal. For example, police officers will regularly sit by the side of the road with a speed gun. They'll make no attempt to stop you driving at 150mph on the motorway but, in the UK, you'll receive a court summons through your door after the fact (and probably lose your license).
      - deleted 3y ago
- JumpCrisscross 3y ago
  > that "heroin is illegal" is cut and dry Opiates! Prescribed opiates!
- hef19898 3y ago
  Heroin, as in heroin derivates, are not illegal. That's what a lot of hard, medical painkillers are. Same goes for weapons in some of the countries with the most restrictions on gun sales and ownership, it is still perfectly legal to sell military grade weapons to the military in those countries. Funny, how HN seems to qctively failing to understand how regulations and compliance works as soon as they themselves, or one of theirs, is negatively affected by them...
  - scott_w 3y ago
    It seems a common "debating" tactic to spend inordinate amounts of effort questioning the analogy and seemingly pretending to not understand what an analogy is.
    - shapefrog 3y ago
      It depends on what the meaning of the word 'is' is

by bb88 3y ago

friend_and_foe 3y ago

Youre completely.ignoring the fact that "heroin is illegal" is cut and dry. Securities are not illegal. Selling them without a license is. Asking them to clarify the law and getting told "the law is clear" is not in any way the same as selling heroin knowing it is illegal.

rjbwork 3y ago
The law is clear. It's not the job of regulatory agencies to advise companies on how to become compliant with the law and their rules. The law and their rules are...the law and their rules! Hire a lawyer for that!
- AnthonyMouse 3y ago
  > It's not the job of regulatory agencies to advise companies on how to become compliant with the law and their rules. Honestly this should be a core mission of all regulatory agencies and the fact that it isn't is a disgrace.
  - JumpCrisscross 3y ago
    > this should be a core mission of all regulatory agencies and the fact that it isn't is a disgrace You want public sector corporate law? If we’re socialising law, I’d think we’d start with criminal defense.
    - bb88 3y ago
      I personally don't want tax dollars to fund corporate lawyering.
    - friend_and_foe 3y ago
      Theres a distinction somewhere between "socializing law" and "tell me why you'd sue me before I do it accidentally."
      - hef19898 3y ago
        The latter isn't a thing so. Especially if, as Coinbase and Binance did, ignore willingly the most basic rules around ypur business because of tech, innovation, disruption and the internet. About time that reality checks happen.
  - rjbwork 3y ago
    It would be absurdly burdensome and expensive for the government to have to advise people on how to follow the law when they're not following the law. If you're not sure how to follow the law, get an expert in the law! That's why there's a regulated profession that explicitly provides expert advice on following the law. I don't want to press too far, because I don't think you actually meant it, but...it's like you're advocating for socialized lawyers. Which is definitely an interesting idea!
    - AnthonyMouse 3y ago
      > It would be absurdly burdensome and expensive for the government to have to advise people on how to follow the law when they're not following the law. Isn't this the exact same burden it would be for that person to hire a lawyer? All it would do is require the government to internalize the cost of regulatory compliance, which would increase efficiency by aligning the incentives of the government with reducing compliance costs. > If you're not sure how to follow the law, get an expert in the law! That's why there's a regulated profession that explicitly provides expert advice on following the law. Except that they don't actually have the authority to tell you if you're following the law. If you hire a lawyer and they tell you that the law is ambiguous and there isn't any relevant caselaw yet, you still have no idea if you're following the law or not. Meanwhile no one with the authority to make a binding determination will give you an answer.
      - rjbwork 3y ago
        >If you hire a lawyer and they tell you that the law is ambiguous and there isn't any relevant caselaw yet, you still have no idea if you're following the law or not. Then you have a couple of choices with various outcomes. One of which is exactly what is happening to Coinbase right now. You can either 100% unambiguously follow the law, or you can push your luck and adhere to what you think either is or should be the law. In the latter case you may become said case law, whether you are able to continue your current ambiguously legal business practices or not!
        AnthonyMouse 3y ago
  - hef19898 3y ago
    It is not the government's job to provide free compliance consulting services. Especially not for VC backed companies awash in cash.
- deleted 3y ago
  [deleted]
bb88 3y ago
I quote from TFA: Coinbase also writes in great detail in the S-1 about the risk that the SEC might bring a lawsuit exactly like the one they just have: [W]e could be subject to legal or regulatory action in the event the SEC, a foreign regulatory authority, or a court were to determine that a supported crypto asset currently offered, sold, or traded on our platform is a “security” under applicable laws… [W]e could be subject to judicial or administrative sanctions for failing to offer or sell the crypto asset in compliance with the registration requirements, or for acting as a broker, dealer, or national securities exchange without appropriate registration. [T]here is regulatory uncertainty regarding the status of our staking activities under the U.S. federal securities laws. It's pretty clear they knew they were operating in a shady area from their S1 filing -- and so now you're surprised the regulatory hammer fell on them? Imagine if a company was selling "ground human meat" (see the movie "Soylent Green"). And they did it, well, because the market for ground human meat was suddenly exploding! I mean, in their S1 they might say "Sure this might be illegal, the FDA might take regulatory action against us." But also "Ground human meat is one hot market right now, you don't want to be left out on this rocket that's going straight to the moon!"
- rockemsockem 3y ago
  Sounds like they expected in advance for the SEC to do something stupid and were very upfront about that fact. Now that the SEC has done a stupid thing they are complaining that the SEC in fact did the stupid thing. Sounds perfectly reasonable to me.
  - scott_w 3y ago
    Enforcement agencies don't have to stop you ahead of time, even if that action is disallowed or even illegal. For example, police officers will regularly sit by the side of the road with a speed gun. They'll make no attempt to stop you driving at 150mph on the motorway but, in the UK, you'll receive a court summons through your door after the fact (and probably lose your license).
    - deleted 3y ago
JumpCrisscross 3y ago
> that "heroin is illegal" is cut and dry Opiates! Prescribed opiates!
hef19898 3y ago
Heroin, as in heroin derivates, are not illegal. That's what a lot of hard, medical painkillers are. Same goes for weapons in some of the countries with the most restrictions on gun sales and ownership, it is still perfectly legal to sell military grade weapons to the military in those countries. Funny, how HN seems to qctively failing to understand how regulations and compliance works as soon as they themselves, or one of theirs, is negatively affected by them...
- scott_w 3y ago
  It seems a common "debating" tactic to spend inordinate amounts of effort questioning the analogy and seemingly pretending to not understand what an analogy is.
  - shapefrog 3y ago
    It depends on what the meaning of the word 'is' is